Report: Removing US Oil Ban Would Create Jobs Beyond Drilling

Rig Zone ^ | March 17, 2015 | Reuters

[nascarnation]

I remember just before I retired in 2008, one of my office mates has a large poster showinga graph of production with “peak oil” occurring.

I wonder if he still has it up?

[thackney]

Over production does not a case make. Everyone jumped in to produce more and the marketplace reacted.

Please understand, this is more an issue due to different types of oil and the location.

Much of the Gulf Coast refineries have been upgraded to to make use of heavy sour crude. And the new shale production is light sweet. We have already taken our Gulf Coast area light sweet imports down to zero. It is not as simple as total oil numbers.

[DoughtyOne]

Thackney, was there over-production or not?

Come on, don’t act like you don’t understand these dynamics.

We both know you do.

[thackney]

was there over-production or not?

If you are looking at total numbers, for total oil global supply, yes.

The issue about removing the Oil Ban, the topic of this thread, is based upon the US have had several million barrels a day increase specifically in light sweet and in limited areas.

The US still is an importer of crude oil. We don't come close to producing as much as our refineries use. Many of our refineries are designed for cheaper heavy sour, that contains more BTUs per barrel.

[DoughtyOne]

Frankly, I think we need more refineries. We have needed them for several decades. One refinery goes down, and it has negative ramifications clear across the nation.

We just had a refinery go down here in California. In short order prices rose over $1.00 per gallon.

That magnified the natural rise after crude rebounded.

I’m not industry savvy enough to address the light crude vs sweet crude issue. I won’t give you an alternative argument there.

[DoughtyOne]

Thank you for that information.

[DoughtyOne]

I should address one aspect of this, that I didn’t.

If we have increased production of light or sweet crude, doesn’t it make sense to increase capacity to refine these products?

I believe you mentioned that we refitted (or whatever the proper term is) one or two of our refineries so they would be used to refine heavy sour rather than the light or sweet.

To utilize all that we produce, we should have the capacity to refine what we are producing.

[conservatism_IS_compassion]

Depleting our oil reserves only to run out and have to depend on other nations again makes no sense whatsoever.

Jimmy Carter, is that you? Carter’s theory was that US natural gas would, in some not distant future, suddenly be exhausted. Granted it took a generation to fully come into reality with horizontal drilling and shale fracking, but that theory was at direct odds with what sensible theory predicted. Price elicits supply. If a product is cheap, that is because it is and is expected by the smart money to remain plentiful.

Our oil reserves should remain our oil reserves.

You and that mouse in your pocket own the fuel deposits in the US?

If you believe in private property you don’t believe in that claptrap. It is socialism. thackney is exactly right.

It is much better to let the market mechanism sort out which oil gets shipped where. It makes more economic (and diplomatic) sense to ship some Alaskan oil to Japan, rather than forcing the Japanese to import oil at higher shipping cost from the Middle East.

Another possible consideration is the bruited possibility of an “intelligence singularity” in the foreseeable future. If computers - conceivably neural network programs running on quantum computers - suddenly get so smart that they dwarf human intelligence, possibilities ranging from ways to not need as much energy to practical controlled nuclear fusion power plants might very well suddenly transform the energy equation. That is a possible mechanism by which your far-fetched “peak oil” fantasy might be utterly mooted within a generation.

Even without such singularity, the cost of drilling and fracking has been declining with experience. That moves your “peak oil” schedule that much further into the future.

Things tend to be worth what people are willing to pay for them.

[DoughtyOne]

I appreciate you wanting to play too, but I’ve already carried on a discussion with Thackney, and am not interested in taking on another person who is wrong.

Next time be sure to call me Ted Kennedy, Nancy Pelosi, or Harry Ried. That will certainly add facts to the equation.

Take care.

[thackney]

I think we need more refineries.

We already refine more product than we use ourselves. We export surplus refined product.

One refinery goes down, and it has negative ramifications clear across the nation.>/i>

Again, government is the limiting factor and not the industry. We have a multitude of different blends and special receipies required in different location. When California lost a major refinery and had another major one shut down due to the strike, the price spiked.

You cannot take Texas gasoline and use it in California. The government restrictions limit the industry ability to move product where it is needed.

I’m not industry savvy enough to address the light crude vs sweet crude issue.

It is light sweet, versus heavy sour, and it is THE issue concerning the export ban. Otherwise, we would not notice it.

While imports have dropped, they have not dropped equally across the different types.

[thackney]

We spent billions of dollars to use cheaper oil. Now you want them to spend billions more to use a more expensive oil, for what end?

[DoughtyOne]

Thank you for your response.

I realize government is the problem with new refineries. That should not be the case.

I’m certainly no lover of big government. I do consider a strategic energy source to be something with a high enough impact on the nation, to warrant government purview.

There are compelling points to be made on both side of this issue, and there will times when there are going to be conflicts with traditional beliefs, as they cross over between a normal product and one with strategic implications.

I am arguing my point, but down the road I may see it differently. For now, this is how I see it.

[DoughtyOne]

Why do you ask questions whose answers are clear as the nose on your face?

I do not approve of sending our energy reserves overseas.

Once our energy reserves are depleted, we will be energy dependent on other nations again.

I DO NOT WANT THAT TO BE THE CASE AGAIN.

We have made improvements in our foreign energy reliance.

I do not wish to give these improvements back.